COLLIN GALLANT
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The Teamsters Rail Conference is vigorously preparing a response to news late last week that Canadian Pacific Railways has asked the federal government to help break a pension standoff in ongoing collective bargaining talks.
CP Rail, believed to be the largest private employer in Medicine Hat with an estimated 380 unionized employees, has asked the Federal Minister of Labour Lisa Raitt to appoint a conciliator to help move along talks with 4,800 train crew employees and rail traffic controllers.
In a press release Friday, the company cited “business imperatives” as the reason for its demand that its formula for funding pensions change and that future pension payments be capped.
“The legacy pension costs significantly impact CP’s operating ratio and our ability to further fund investments that will support growth opportunities for our customers,” said CP president and CEO Fred Green in a statement.
Current pensioners would not be affected, he said, adding that CP has paid $1.9 billion in to the pension plan over the last three years.
The Union disputes the company’s projections and says CP Rail has not been forthcoming with information during negotiations.
Local union officials in Medicine Hat also declined to make a statement but said the issue will be discussed at length at Division 322 Local’s regular monthly meeting this afternoon. 
The Teamsters national office was closed for the holiday on Monday but an official who answered the phone said that a response to the request for mediation was a high priority for the union and would likely be ready early next week. 
In the summer, the Ministry of Labour in Ottawa sided with employers in two high-profile cases involving Canada Post and Air Canada.
Both companies won pension concessions as Ottawa issued back to work orders.
The latest five-year collective agreement between CP and its workers expired on Dec. 31, 2011, and the two sides have met four times to discuss a new contract.
The latest national bargaining session took place from Feb. 7-10 in Toronto according to the company’s request to the federal mediator.
Dates are scheduled for talks next week, and two week-long sessions in March and April.
In late January, Canadian Pacific announced that its third-quarter profit had risen to $221 million for the three-month span, including a one-time tax gain, that put profits slightly above par from the same time in 2010. Total revenue rose to $1.4 billion, from $1.29 billion in 2010, while costs grew $109 million from a year earlier to total $.1 billion.
CP is under increasing pressure to improve corporate performance of the railroad after activist hedge fund Pershing Square Capital Management acquired a 14 per cent stake in late 2011 for an estimated $1 billion.
The New York-based fund, led by Bill Ackman, has made a number of overtures that the current board of directors and, specifically, its CEO Green, need to step aside in order for the company to improve its bottomline.